Lloyds Banking Group has sold off a portfolio of loss-making Irish retail mortgages in a deal valued at £257 million.

The portfolio, which the state-backed bank described as “non-performing” has been sold to Tanager Limited, reported to be a company affiliated with US 'alternative investment' manager, Apollo Global Management.

Lloyds said the gross asset value of the portfolio are valued at £610 million, and generated losses of £33 million in the year to 31 December 2012.

The sale, expected to complete in the first-half of 2014. is not expected to have a “material impact on the group, due to existing provisions taken against these assets”.

Lloyds reported in full-year results in March it planned to offload another £20 billion in non-core assets in 2013 in an effort to reduce its non-core portfolio to £70 billion or less by the end of 2014.

Lloyds, which inherited much of its under-performing loan book from its £12.2 billion takeover of Halifax Bank of Scotland in 2008, postponed plans in June to offload around Euro 2 billion (£1.7 billion) of non-performing Irish residential loans as it sought clarity on lender repossession rights.

The Irish Government introduced new legislation in March - The Land and Conveyancing Law Reform Bill 2013 - which overturned a previous High Court ruling which had effectively blocked lenders from repossessing homes.

A 2011 High Court ruling, known as the "Dunne Judgement", identified a loophole in the Land and Conveyancing Law Reform Act 2009 which meant lenders could not apply for repossession under a 1964 law where a mortgage was created before December 1, 2009 if a demand for full payment was made after that date.

This ruling had effectively closed off applications for orders for repossession since July 2011.

Ratings agency Moody's announced in March this year it would not change its negative outlook on Ireland's credit rating amid concerns at the slow pace of property repossessions on loans in long-term arrears.

The legal loophole was closed in October when The Land and Conveyancing Law Reform Bill 2013 was introduced into law.

Research conducted by The Irish Times found in the first month following the introduction of the new act, 465 legal actions had been initiated in Irish courts to repossess properties, 60 per cent of which were instigated by Royal Bank of Scotland subsidiary, Ulster Bank.